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Corporate Laws Central Ministry of Finance Securities and Exchange Board of India Act, 1992

Norms for Internal Audit Mechanism and composition of the Audit Committee of Market Infrastructure Institutions

19-May-2025 | SEBI/HO/MRD/POD 3/P/CIR/2025/69

SEBI has issued a circular regarding the Norms for Internal Audit Mechanism and composition of the Audit Committee of Market Infrastructure Institutions (MIIs) effective from 17th August, 2025. Key Highlights are as follows: 1. Every Market Infrastructure Institution are required to conduct internal audit of all functions and activities of the MII at least once in a Financial Year. 2. The MII shall have a duly approved policy for the appointment of internal auditors approved by the Audit Committee and governing board of the MII. 3. The Internal Auditor shall report only to the Audit Committee of the MII and observations of the internal auditor shall be sent to the respective Head of Departments (HoDs) for their comments in a time-bound manner. 4. The internal auditor shall communicate to the Audit Committee at least once in every six months within 60 days from the end of September and March specifying the critical issues concerning the MII. 5. The Audit Committee of the MII shall not consist of any Executive Director (including the Managing Director) of the MII. 6. The auditors of the MII and the Key Management Personnel shall have right to attend the committee meeting but not have right to vote. 7. The provisions of the circular shall be applicable from the 90th day of issuance of the circular i.e 17th August, 2025. Kindly refer to the attached document for more information.

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